The Weekly Standard reserves the right to use your email for internal use only. Occasionally,
we may send you special offers or communications from carefully selected advertisers we believe may be of benefit to our subscribers.
Click the box to be included in these third party offers. We respect your privacy and will never rent or sell your email.

Please include me in third party offers.

In a mid-year report to Congress, National Taxpayer Advocate Nina E. Olson weighed in on the controversy surrounding the IRS's review of exempt organization (EO) applications. The Taxpayer Advocate Service (TAS) "is an independent organization within the IRS and helps taxpayers resolve problems with the IRS and recommend changes that will prevent the problems." Although Olson noted that "the Advocate’s office does not have investigative authority and did not seek to duplicate other ongoing investigations," nevertheless the IRS came under harsh criticism in her report for its vague policies and lack of transparency, and even possible violation of the law.

The EO Function Did Not Post Its Procedures on the Internet, Potentially Violating the Law and Contributing to the Problem. The IRS is required to post on its website all “instructions to staff that affect a member of the public,” unless an exemption applies. Even if an exemption applies, IRS functions should clear most guidance internally with affected program owners and “specialized reviewers” such as TAS. EO did not clear with TAS or post on the Internet, even in redacted form, relevant training materials, form letters used to request additional information, the screening checksheet used by EO employees in the determinations process, and other key documents. EO’s failure to clear its procedures with TAS and other stakeholders bypassed an important safeguard of taxpayer rights.

Had these documents been vetted by TAS, TAS would have had an opportunity to raise concerns before implementation. Had these documents been posted on the Internet, members of the public would have had access to them, providing greater transparency and enabling them to raise concerns about improper practices. Key EO documents still are not posted to the Internet, and TAS has not been able to locate them on the IRS intranet. The Tax Exempt and Government Entities Division (TE/GE), of which EO is a part, has agreed to share its guidance with TAS. The Advocate recommends that the IRS adopt more expansive disclosure policies both in TE/GE and throughout the IRS.